Lodha Developers Limited — Q1 FY26 earnings call

Call held 28 Jul 2025

Management summary

Lodha delivered best-ever Q1 presales of INR 44.5 billion despite two weeks of India-Pakistan geopolitical tension in May. The company achieved exceptional business development of INR 227 billion GDV, front-loading over 90% of full-year guidance. Environmental clearance delays since August 2024 are expected to be resolved by the Supreme Court this quarter. Management is bullish on mid-income demand driven by rate cuts and income tax cuts, targeting a new base of INR 50 billion quarterly presales. NCR entry planned within 12 months.

Highlights

  • Best ever Q1 presales at INR 44.5 billion, up 10% YoY; 6th consecutive quarter above INR 40 billion

  • Embedded EBITDA margin at 33% with JDA at 38% of presales (in line with long-term guidance)

  • Pro forma PAT INR 9.5 billion (21% margin); on track for ~20% ROE

  • Net debt at INR 50.8 billion (0.24x equity); cost of funds at 8.3%, down 40 bps QoQ

  • Business development of INR 227 billion GDV in Q1 (>90% of full year guidance); 5 projects across Mumbai, Pune, Bangalore

  • Bangalore BD of INR 84 billion in Q1 (exceeding full year FY25 Bangalore BD); growth phase scaling

  • Non-launch weekly sales at INR 275-280 crores, targeting INR 300 crores by FY end

  • Collections grew 7% YoY to ~INR 29 billion; launch pipeline of INR 250 billion for FY26

Concerns

  • Environmental clearance blockage since August 2024 constraining supply

Key financials

2 periods

Headline

  • Embedded EBITDA Margin
    33%
  • Pro Forma PAT
    ₹9.5 Bn
  • PAT Margin
    21%
  • Net Debt
    ₹50.8 Bn
  • Net Debt to Equity
    0.24
  • Avg Cost of Funds
    8.3%
  • Collections
    ₹29 Bn
    YoY +7%
  • BD GDV Added Q1
    ₹227 Bn
  • Non-Launch Weekly Sales
    ₹280 Cr

Q1

  • Presales
    ₹44.5 Bn
    YoY +10%
  • Price Growth
    2%

What they filed

Q1 FY27: revenue up 30.7%, net profit up 63.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue2,590 4,016 3,890 3,349 2,983 +15%4,307 +7%3,902 +0%4,378 +31%
EBITDA682 1,271 1,047 958 618 −9%1,328 +4%963 −8%1,525 +59%
Net profit393 832 742 644 336 −15%1,146 +38%794 +7%1,050 +63%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Guidance & targets

Presales

  • FY26 presales guidance Presales · FY26 · High confidence INR 210 billion; targeting INR 50 billion quarterly base
    We are now headed towards establishing a new base of Rs. 50 billion of quarterly presales, which should be the average number through the course of the full year

    — Abhishek Lodha

Growth

  • Non-launch weekly sales target Growth · FY26 · High confidence INR 300 crores per week by FY end

    From INR 250 crores in FY25 today

    We expect this number to touch Rs. 300 crores a year by the end of this FY from Rs. 250 crores a year in FY '25

    — Abhishek Lodha

Expansion

  • NCR entry Expansion · FY27 · Medium confidence Within 12 months; launch FY27
    We expect to enter Delhi NCR in the next 12 months and hope to launch in fiscal 2027

    — Abhishek Lodha

Risks & concerns

  • Environmental clearance blockage since August 2024 constraining supply

    high

    NGT order preventing environmental clearances nationwide since Aug 2024. Supreme Court expected to decide this quarter. Blocking new project approvals in Mumbai and other cities.

    Management acknowledged

  • IT sector weakness and lender concerns could affect housing demand

    medium

    Management addressed concern directly: top developers constrained by supply not demand. Non-launch weekly sales tracking higher YoY. Real estate driven by households with >INR 1 million annual income.

    Analyst downplayed

  • Geopolitical disruption (India-Pakistan tension) affected May sales

    low

    Two weeks of geopolitical tension in May 2025 moderately affected Q1 presales. Management says it doesn't affect full year growth outlook.

    Management acknowledged

Q&A highlights

3 direct
Demand resilience amid IT layoff concerns Direct
Non-launch weekly sales around Rs. 275-280 crores per week, much higher than same period last year. Top 5 developers constrained by supply not demand. Short-term demand aberration unlikely to impact sales.

Directly addresses market anxiety about IT sector headwinds affecting housing demand

Asked by Analyst

Environmental clearance bottleneck impact Direct
Environmental clearances not considered since August 2024 due to NGT order. Expected to be decided by Supreme Court this quarter. Will enable scaling up supply and achieving presales guidance.

12-month approval blockage is a significant supply constraint; resolution is critical for H2 performance

Asked by Analyst

Bangalore growth phase scaling Direct
Added INR 84 billion in Bangalore in Q1, more than full year FY25 Bangalore BD. Landowners starting to see strength of Lodha brand in Bangalore as they have in Mumbai and Pune.

Bangalore scaling validates geographic expansion strategy and provides growth diversification

Asked by Analyst

1 min read 5 chapters

Detailed narrative

Best-Ever Q1 Despite Geopolitical Disruption

Presales of INR 44.5 billion grew 10% YoY despite two weeks of India-Pakistan tension in May. Non-launch weekly sales running at INR 275-280 crores, well above prior year. Management targeting INR 50 billion quarterly base and INR 300 crores weekly non-launch sales by year end. H1 expected at 40-45% of AOP with upward bias.

Exceptional Business Development Front-Loading

Q1 BD of INR 227 billion GDV across 5 projects exceeds 90% of full year guidance. Bangalore BD of INR 84 billion surpassed full FY25 Bangalore additions, signaling growth phase acceleration. Industry consolidation favoring top brands on supply side continues. NCR entry planned within 12 months with pilot phase launch in FY27.

Conservative Balance Sheet Maintained

Net debt at INR 50.8 billion (0.24x equity) well below 0.5x ceiling despite significant BD investments. Cost of funds reduced 40 bps QoQ to 8.3%. Collections grew 7% to ~INR 29 billion. Management expects debt levels to moderate in H2 after H1 BD front-loading.

Environmental Clearance Resolution Imminent

Environmental clearances blocked nationwide since August 2024 due to NGT order. Supreme Court decision expected this quarter. Resolution critical for scaling supply and achieving full-year targets. Launch pipeline of INR 250 billion for FY26 with heavier H2 emphasis.

Market Fundamentals Support Continued Growth

RBI rate cuts (50 bps YTD) and income tax benefits for households up to INR 25 lakhs boosting mid-income demand. Green-certified portfolio exceeds 60 million sq ft. 2% price growth in Q1 on track for 6% full year target. Real estate multiplier to economic activity is highest of any sector.

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